Strong earnings have propelled Alphabet stock higher, along with the announcement of their first-ever dividend and buyback program.

Alphabet shares experienced a significant 10% surge on Friday morning following the release of better-than-expected first-quarter results, coupled with the groundbreaking announcement of the company’s inaugural dividend and a massive $70 billion stock buyback plan. The tech giant reported a revenue of $80.54 billion, marking a 15% uptick from the previous year and outpacing analysts’ estimates of $78.59 billion in sales. Additionally, Alphabet’s earnings per share of $1.89 surpassed Wall Street’s expectations of $1.51 per share.

As part of the groundbreaking move, Alphabet’s board of directors approved a dividend of 20 cents per share, slated to be disbursed on June 17 to all shareholders on record as of June 10. The company also outlined its intent to continue quarterly cash dividend payouts and further revealed its plan to repurchase an additional $70 billion worth of its own stock.

Alphabet not only exceeded projections for YouTube advertising revenue but also saw robust growth in Google Cloud revenue, signaling positive momentum in key areas of its business. Analysts from Barclays maintained their overweight rating on Alphabet’s stock and upped their price target to $200 from $173, applauding the company’s strategic balance between investments, operational efficiency, and shareholder returns.

Other financial institutions, including Oppenheimer and Morgan Stanley, also revised their price targets for Alphabet stock in light of the stellar performance. Oppenheimer raised its target to $205 from $185, emphasizing the company’s thriving advertising business amid substantial investments in artificial intelligence. Meanwhile, Morgan Stanley increased its price target to $195 from $165, highlighting Alphabet’s robust core growth prospects and cost optimization initiatives.

Following the impressive earnings report, various analysts revised their price targets for Alphabet stock upwards, with JPMorgan and Evercore ISI also increasing their targets to $200, underscoring the positive market sentiment towards the tech giant’s performance.

Alphabet’s success in driving growth, enhancing operational efficiency, and rewarding shareholders through dividends and buybacks has positioned the company favorably in the eyes of investors and analysts alike. The positive outlook for Alphabet’s stock reflects confidence in its continued growth trajectory and strategic focus on innovation and value creation for stakeholders.

— good’s Michael Bloom contributed to this report.

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